Motif Records Corp. v. Brummer

HERNDON, J. The appeal herein is taken by plaintiff and cross-defendant Motif Records Corporation from a judgment entered in favor of defendant and cross-complainant Brummer for $5,545.25. The amount of the judgment was arrived at by setting off certain sums found due to plaintiff from defendant and allowing credit therefor against the sum of $6,000 which Brummer successfully claimed under his cross-complaint.

The evidence discloses that about June 1956, Milton Vedder discussed with defendant the former’s intentions of going into the recording business. Vedder was inexperienced in this business and, in getting started, sought out Brummer because of his experience. Following various preliminary negotiations, on August 7, 1956, Vedder, Brummer, Clarence D. Miller, Felix De Cola and Othmar Grimm entered into a written agreement providing, in part, that Vedder had caused plaintiff corporation to be organized and had advanced the necessary preliminary expenses therefor. It was provided that there could be issued and delivered to the contracting parties shares of the capital stock of such corporation in the following proportions: Vedder 51 per cent, Miller 22 per cent, Brummer 20 per cent, De Cola 5 per cent and Grimm 2 per cent. It was also recited that none of the parties, other than Vedder, had advanced or paid any sum for the issuance of said shares and it was provided that such shares be issued “for services performed and to be performed in the future by them for said corporation.” The four individuals, other [867]than Vedder each agreed, upon receipt of said shares, to immediately deposit the same with an escrow holder with the understanding that if he remained in the employ of the corporation for a period of one year after deposit thereof and performed his services to the corporation in a manner satisfactory in all respects then said shares would be returned to such stockholder and should thereafter become his separate property. The shares were to be released to each of them only upon written authorization of Vedder and none were to be sold at any time without first offering such shares to Vedder for his purchase. The evidence discloses that Vedder never thereafter approved the release of any of said shares to Brummer.

By his cross-complaint Brummer alleged that he was subsequently employed by plaintiff corporation under an oral agreement, for a weekly salary, in the capacity of vice-president in charge of artists and repertoire, which in the recording industry is known as an “A and R man.” The “A and R man” is one whose duties are to select the music, the artists who are to perform it, the orchestrators, staff conductor and the studio, and to supervise the quality of the work that goes into the recording resulting in a finished product ready for sale. He contends and introduced evidence to the effect that he was so employed for an agreed compensation of $250 per week; that he rendered such services to plaintiff for 24 weeks and that the total sum of $6,000 remains due and unpaid to him therefor.